Fri, May 30, 2008
Pricetag Surpasses $2 Million Due To Tougher Economics
Customers attending
Eclipse Aviation's 10th Anniversary "E-rrival" gathering in
Albuquerque heard exciting news Friday, with the announcement of
the Eclipse 400 single-engine jet. That news was tempered somewhat,
however, by the disappointing -- though not entirely unexpected --
announcement the pricetag for an Eclipse 500 has crested the $2
million mark.
Effective immediately, new orders for the Eclipse 500 are priced
at $2.15 million, in June 2008 dollars. The planemaker blamed the
hike in part on escalating costs to produce the 500, many tied
to the current slump in the US dollar, and production issues to
date.
But there is another reason as well... in Raburn's words,
"Eclipse must be profitable in 2009.
"Eclipse's cost-driven pricing model requires Eclipse to
re-examine aircraft pricing if actual costs change significantly
from projections," he added. "The new Eclipse 500 price has been
set based on a number of factors, including higher manufacturing
costs and a slower than anticipated production ramp rate. These
cost changes necessitated a corresponding shift in aircraft
pricing."
Customers who purchased the EA500 at $1.595 and below -- and who
have not yet paid their 50 percent price deposit -- will also see a
commensurate increase in the prices of their jets. Existing
customers will have 90 days to determine whether or not to stay
with their current purchase, transferring their deposit to an
Eclipse 400 order... or, cancel their order outright, and be
refunded their deposits.
Eclipse notes that even with this price adjustment, the Eclipse
500 remains the industry’s lowest-priced VLJ, and is still
priced below today's current entry-level jets while delivering fuel
burns that are half that of similar VLJs.
When first announced 10 years ago, Eclipse had hoped to bring
its inaugural VLJ to market for less than $1 million... but alas,
it was a different world then...
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